Tax-Efficient Withdrawal Strategy
Optimize your retirement withdrawals from Traditional IRA, Roth IRA, and taxable accounts to minimize taxes and maximize your retirement income.
Account Balances
597080
65 years old
0%6.5%13%
5%
Conservative Strategy
Use taxable accounts first, then traditional, then Roth
Taxable:
$8K
Traditional:
$16K
Roth:
$36K
Annual Tax:$4,640
Effective Rate:7.7%
Balanced Strategy
Mix of all accounts to stay in lower tax brackets
Taxable:
$16K
Traditional:
$32K
Roth:
$12K
Annual Tax:$9,280
Effective Rate:15.5%
Roth-Heavy Strategy
Prioritize Roth withdrawals for tax-free growth
Taxable:
$8K
Traditional:
$43K
Roth:
$9K
Annual Tax:$11,930
Effective Rate:19.9%
Recommended Strategy: Conservative
Annual Tax Savings: $7,290
Savings vs. worst strategy
Key Benefits:
- Preserves Roth accounts for maximum growth
- Simple withdrawal order
- Minimizes current taxable income
Important Tax Considerations
•Required Minimum Distributions (RMDs) start at age 73 for traditional accounts.
•Roth IRA withdrawals of contributions are always tax-free and penalty-free.
•Taxable account gains may qualify for lower capital gains tax rates.
•Consider tax-loss harvesting in taxable accounts to offset gains.
•Consult a tax professional for personalized advice based on your situation.